getting qualifiedLenders use the following criteria to qualify an applicant for home financing.
- the home appraisal:
your home purchase value must have a market value that secures the financing. In other words, if you want to borrow $200,000 for your home purchase, the appraised value of the home (and the surrounding neighborhood) must be at least $200,000 or more: check your home value
- your credit rating:
your credit rating must be above a certain score in order to qualify. The lower your credit score, the less likely your financing request will be approved: check credit report | get fico score
- your housing debt (housing ratio):
the monthly mortgage debt (including your escrow payment) on your home must be around 28% or less of your total gross income. Lenders may not approve mortgage loan debt that exceeds this ratio: calculate your housing ratio
- your capacity to repay (income ratios):
your total debt (including your housing debt) must be around 36% or less of your gross income in order to qualify. The more debt that you have compared to your income may disqualify you from financing: calculate your debt ratio
- your employment:
lenders qualify applicants who are employed and have steady income.